The Foreign Service Journal, January-February 2016

THE FOREIGN SERVICE JOURNAL | JANUARY-FEBRUARY 2016 85 AFSA NEWS annuitants of federal annuities. Social Security is not taxed in Indiana. Sales tax and use tax in Indiana is 7 percent. I OWA Annuities and pensions are generally taxable. Amarried couple with an income for the year of less than $32,000may file for exemption, if at least one spouse or the head of household is 65 years or older on Dec. 31. Single persons who are 65 years or older on Dec. 31 may file for an exemption if their income is $24,000 or less. The same income tax rates apply to annuities as to other incomes. As of 2014, Social Security benefits are not subject to taxation. State- wide sales tax is 6 percent, with no more than 1 percent added in local jurisdictions. KANSAS U.S. government pensions are not taxed. There is an extra deduction of $850 if the individual is over age 65. Social Security is exempt if federal adjusted gross income is under $75,000. State sales tax is 6.3 percent, with additions of between 1 and 4 percent depending on jurisdiction. KENTUCKY Government pension income is exempt if the individual retired before Jan. 1, 1998. If retired after Dec. 31, 1997, pension/annuity income up to $41,110 remains fully exclud- able for 2015. Social Security is exempt. Sales and use tax is 6 percent statewide, with no local sales or use taxes. LOU I S I ANA Federal retirement benefits are exempt from Louisiana state income tax. There is an exemption of $6,000 of other annual retirement income received by any person age 65 or over. Married filing jointly may exclude $12,000. State sales tax is 4 percent with local additions up to a possible total of 10.75 percent. Use tax is 8 percent regardless of the purchaser’s location. MA I NE Recipients of a govern- ment sponsored pension or annuity who are filing single may deduct up to $10,000 ($20,000 for married filing jointly) on income that is included in their federal adjusted gross income, reduced by all Social Secu- rity and railroad benefits. For those age 65 and over, there is an additional standard deduc- tion of $1,450 (single), $1,150 (married filing single) or $2,200 (married filing jointly). General sales tax is now 5.5 percent, 8 percent on meals and liquor. MARYLAND Those over 65 or perma- nently disabled, or who have a spouse who is permanently disabled, may under certain conditions be eligible for Maryland’s maximum pension exclusion of $29,000. Also, all individuals 65 years or older are entitled to an extra $1,000 personal exemption in addition to the regular $3,200 personal exemption available to all taxpayers. Social Security is exempt. See the worksheet